With a shortage of supply in the housing market across the country, buyers may find themselves competing with other buyers for their dream home. It's important to be ready financially and have research done with an experienced real estate agent before going head-to-head on a bid. Here are some ways to have a competitive advantage for the home you want to purchase:
- Get pre-approved for a loan. Don't just talk to a lender about potential loans- submit all of your required documentation to receive a pre-approval letter.
- Pay with cash if you can. Usually an all-cash offer will take the bid because it makes the settlement speedy and removes any financial uncertainty. Cash sales have been declining nationwide but Palm Beach County, for example, will still see anywhere from 10-40% paid in cash on any given month.
- Try making a larger deposit. It shows the seller you're serious and have the finances.
- If you've gotten pre-approval and are certain you will receive a loan, waive the financing contingency.
- Make your offer quick. While sellers don't always take the first offer, seeing the property as soon as possible and making an offer puts you at the front of the line. Most of the time sellers want to settle as soon as possible, so it's a good idea to propose a date as soon as the lending and title company get back with you.
- Waive the appraisal contingency. A good agent can help you determine the value of a home so you can skip the appraisal- as long as you have cash to cover the gap between a low appraisal (which can limit how much you borrow) and your offer. Just make sure you trust your agent and aren't overshooting it with your offer.
- Personalize your offer in today's electronic world. Make the sellers like you by writing a letter, for example, that would make them feel emotionally drawn to selling to you over someone else.
- Consider an escalation clause. It's an addendum that allows your agent to increase your offer X-amount above the next best offer, say $1,000. Before doing this, you'd need to make sure you have enough money- in cash too, in case the price goes a bit above your loan limit.
Buying a home is an exciting experience and Waterfront Properties is here to help! Browse our award-winning agents to find a realtor you trust, check out our blog page to see all the fun things to do in the Palm Beach County area, and start your search by either scrolling through our featured listings or use our personalized search tool here.